Gold prices fall in global markets

Gold prices fell on Wednesday after a continuous rise in the international market. Investors have become more cautious as rising oil prices have raised new concerns about inflation and US interest rates. As a result, interest in gold as an interest-free asset has decreased slightly.

The price of gold per ounce fell by 0.7 percent to $4,2512 as of 2:05 pm Bangladesh time on Wednesday (July 15). At the same time, the price of US gold futures for August delivery fell by 1 percent to $4,3040.

Earlier on Tuesday, gold prices rebounded from a two-week low to $4,104 per ounce after data was released that consumer inflation in the United States for June fell more than expected.

However, oil prices rose for the third consecutive day on Wednesday. US President Donald Trump reimposed a naval blockade on all Iranian ports and threatened to attack power plants and bridges next week if Tehran does not return to talks. In this situation, instability in the global energy market has increased.

Investors are now paying more attention to the geopolitical situation in the Middle East than to inflation data, said Kelvin Wong, senior analyst at market analyst firm O&A. Oil prices are rising due to uncertainty over shipping traffic through the Strait of Hormuz, which is putting pressure on the gold market.

Although gold is generally considered a safe investment against inflation, the attractiveness of this interest-free metal decreases when interest rates are expected to be higher.

Meanwhile, top officials at the US Federal Reserve, the central bank, said that while June's inflation data was positive, more favorable data will be needed to confirm that inflation is falling permanently.

The market's attention is now on the US Producer Price Index (PPI) data. The data could provide new clues about future inflation and the possible direction of the Federal Reserve's monetary policy.

Meanwhile, among other precious metals, silver fell 0.8 percent to $58.18 an ounce in the spot market. Platinum fell 0.2 percent to $1,628.6. However, palladium rose 0.5 percent to $1,311.84 an ounce.